Book Reviews: "MONEY" by Steve Forbes

A weak U.S. dollar is a threat to the global economy and the only way to stop the greenback’s decline is to reintroduce a gold standard, said media tycoon, Steve Forbes.

Forbes, the editor and chief of Forbes Media, was one of the keynote speakers at the annual Freedomfest conference in Las Vegas, an annual convention that looks to gather free minds for open discussions on politics and the economy.

In an interview with Kitco News’ Daniela Cambone, Forbes talked about gold’s role it the U.S. economy, which is also highlighted in his latest book MONEY: How The Destruction Of The Dollar Threatens The Global Economy And What We Can Do About It. He said to stop the decline in the U.S. dollar it only makes sense to link it to gold.

Forbes said different currency valuation methods have been tried for “more than 4,000 year,” and experience shows that having a gold standard is the way to go. He added a gold standard “done right” provides stability and value when it comes to money supply.

My big takeaway from Money (McGraw Hill, 2014) is that Steve Forbes is no James Dean. Forbes is a rebel with a cause. Free-markets and sound money, please. In what follows, I will briefly mention 11 other takeaways from my reading of Money by Steve Forbes and Elizabeth Ames.

Takeaway #1 The dedication to Alexander Hamilton signaled right away that Money was going in the right direction. We all know that Hamilton was an extraordinary financial engineer. Among other things, he established a federal sinking fund to finance the Revolutionary War debt. Hamilton also engineered a large debt swap in which the debts of individual states were assumed by the newly created federal government. Hamilton’s ability to solve the debt problem established America’s financial credibility and gave the new nation a much needed positive confidence shock. We are also aware of the fact that Hamilton was a great contributor to the Federalist Papers — a superb document. Indeed, no less than Milton Friedman once wrote in Newsweek (June 4, 1973) that Federalist Paper 15 “contains a more cogent analysis of the European Common Market than any I have seen from the pen of a modern writer.”

Steve Forbes, chairman of Forbes Media and former Republican presidential candidate, was on Newsmax yesterday to talk monetary policy.

According to Forbes, the instability of the dollar, a result of the easy money policies of the Federal Reserve, is a major cause of our recent economic woes, and in order to return to economic growth, we need a monetary policy which will stabilize the dollar. The gold standard, he argues, is just the policy to accomplish this:

“Gold gives money . . . stability just like the ruler measures length, the clock measures time, a scale measures weight,” Forbes added. “A dollar measures value and when the value is stable, you get a lot more investment, a lot more growth, a lot more opportunity.”

Without the gold standard in place, the dollar has grown increasingly unstable, even though there have been “periods of strength,” Forbes says.

“When you have an unstable dollar, you get more speculation,” he explained. “You get the kind of thing you saw with the housing bubble, and so that spells trouble for all of us.”

Forbes makes a similar argument with Elizabeth Ames in their recently published book, Money: How The Destruction of the Dollar Threatens the Global Economy – And What We Can Do About It (which APIA’s Ralph Benko has called “by far, the most important book on economic policy published this year”).

Appearing with Neil Cavuto on FOX News’ “Your World,” Steve Forbes says that it’s time for the U.S. to restore a dollar that is literally as good as gold.

Fresh from writing his new book called Money: How the Destruction of the Dollar Threatens the Global Economy – and What We Can Do About It, Forbes, a two-time presidential candidate and the head of Forbes Magazine, discussed with Cavuto the benefits of returning to the gold standard.

“You say we need to get back to pegging our currency to gold. Why?” asked Cavuto.

“Because currency-to-work is like having sixty minutes in an hour, 12 inches in a foot–it should be fixed value so when you make an exchange, you do a trade, you buy and sell, you know what each of you are getting,” Forbes answered, explaining the devastating disrupting consequences of a constantly declining in value, inflationary fiat monetary system.

The most effective way to return to a sound money policy and a healthy economy is to return to the gold standard, says Steve Forbes, author of "Money: How the Destruction of the Dollar Threatens the Global Economy and What We Can Do About It". Forbes says the devaluation of the dollar is responsible for the weak recovery, lingering long term unemployment and high food and fuel prices. In order to survive the destruction of the dollar, Forbes says investors should consider owning gold, index funds from low cost providers, cash and Treasury Inflation Protected Securities.